J.C. Penney disclosed Monday morning it tapped $850 million of its $1.85 billion credit line to fund operating needs, a move that comes as the company has been talking with bankers in order to help replenish its rapidly dwindling cash coffers.

The announcement, which will allow Penney to fund inventory restocking and other costs related to its renovated home departments, comes after the struggling retailer last week ousted former Apple Inc. wonder boy Ron Johnson as CEO after only 17 months at the helm. Penney is also scrambling to rebound from a 25% drop in sales last year.

The Wall Street Journal last week reported that Centerview Partners is advising J.C. Penney on its fundraising options along with Blackstone Group LP, as the department-store chain looks to a widening circle of bankers for help replenishing its rapidly dwindling cash coffers.

Shares recently rose 1.1% to $14.78 in recent premarket trading.

Here’s Penney’s release:

PLANO, Texas (April 15, 2013) – J. C. Penney Company, Inc. (NYSE:JCP) today announced plans to enhance the company’s financial flexibility and position. As part of that process, and consistent with its previously stated plans, the company has drawn $850 million out of its $1.85 billion committed revolving credit facility. Proceeds will be used to fund working capital requirements and capital expenditures, including the replenishment of inventory levels in anticipation of the completion of its newly renovated home departments next month.

Chief Financial Officer Ken Hannah said, “Earlier this year, we increased our revolving credit facility in anticipation of operating, working capital and capital expenditure needs, especially during the first half of the year. As we near completion of the home department transformation in over 500 stores, we have been undertaking and will continue to experience a significant inventory build and increase in capital expenditures.”

Hannah continued, “The draw under our revolver today provides more than our current funding needs to ensure our continued liquidity. Moreover, we will continue to explore additional capital raising alternatives with the assistance of our financial advisors.”

Over the past few months, the company has worked to improve performance through changes in its pricing and promotional strategies, including the return of coupons, and the development of other new initiatives to drive store traffic and deliver the style, quality and value that its customers want. The action today bolsters those efforts, as well as the company’s on-going financial position.

–Tess Stynes contributed to this report.

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